[Logan]

1>

Thank you Admin for sharing the article, this is what the article mentions about Brightcom :

“Brightcom Media is committed to meeting all the publishers’ monetization needs. They advise publishers on inventory decisions, content optimization, and more to increase their ad revenue.

Publishers will get access to a multi-channel marketing platform where brand safety is vital. If you’re looking for reliable partnerships, trusted inventory, and programmatic solutions at a global scale, Brightcom is for you.

Additionally, they offer competitive CPMs at 100% fill rates, access to premium brands, a long list of ad units, and a dedicated account manager.”

Looking at the comments made by the MonetizeMore team, it shows that Brightcom has a great name in the online advertising industry and well received by all the publishers and advertisers. Also it’s not easy to get good reviews when they are competing with big players like Google, Facebook, AOL etc. Only in India they are not well known.

[Logan]

2n

4) Redmond Investments, part of the promoter group holds close to 5% of the company, it has pledged 100% of its shares. In the previous annual reports it was mentioned that the pledge was because of ICICI Bank loans but that loan is paid off yet the pledge is still there.

5) Promoters salary not disclosed in the annual report. We don’t need verbal answer to that, we want it mentioned in the annual report.

6) COVID-19 ‘s impact on the business and how much hit will the business take going forward.

7) Market share in the industry and how well is the company prepared for the future?

8) Impact of various companies investing in digital sector in India and how our company can take advantage of that.

9) Can the company’s AI division take advantage of disruptions happening in the healthcare industry due to COVID-19?

10) LOC amount and how much growth rate does the company expect after taking LOC?

11) On LOC, we know that interest rates are very low in the US (close to 0%), will the company get loans at lower rates or has to pay higher rates?

12) Need more details on LIL Projects, what their operations are and who their clients are.

13) The CEO needs to promote the company on various business channels like CNBC TV18, ET Now etc.

14) We understand that the company doesn’t want to disturb people like Jacob Nizri, Brad Cohen, Etai Eitany, Shirley Lowenstein, Yaniv Ben-Atia with market related activities but you can share their views and opinions on the industry on your social media platforms and doing this will educate the investors and also we can know more about the company’s subsidiaries and the people involved.

[Logan]

1n

Hi Admin, these are my questions/suggestions. I’ve left out the questions that others have asked.

1) We appreciate the management’s efforts to resolve the outstanding issues but at the same time the company has to look at market sentiment also. When it comes to the financials of the company there’s a lot of ambiguity in the stock market. Many people are trying to spread negative and false information about the company. Our suggestion for the company is to appoint a Big 4 auditor or BDO Global to audit the company’s India operations as well. Appointing BDO will bring trust, credibility, recognition and also boost investors’ confidence. The company can appoint BDO for FY 2020-21.

2) We understand that the company doesn’t want to give out sensitive information about it’s subsidiaries but since there’s a lack of trust in the market about the numbers, the company should find a way to give information about it’s subsidiaries’ financials. We need to see auditor’s signature on the subsidiary’s financials. Even the analysts expect this.

3) We need a breakup of many items in the balance sheet. There are many items classified as “other” and the loans and advances are very high and there’s no information about them in the footnotes either. We all have confusions in that, it’ll not only help us if you give us the details but it’ll also help analysts who want to track the company.

You may say that these are followed according to accounting standards and give verbal answers but we need a presentation on that and also they have to be mentioned with proper details in the annual report.

[Logan]

@odysee, you are absolutely right.

Since there are outstanding issues yet to be resolved I thought the company may need to conserve cash for that.

But when they announced the token dividends I thought it would be far better if the company appointed a big auditor like BDO Global to audit India operations.

The company has to spend little over Rs.2.5 crores for paying dividend but if the auditors charge say 0.50% of the revenue then then the fees will be Rs.2.40 crores. If it’s 0.32% then it will be around Rs.1.6 crores. In the long run appointing a big auditor will benefit shareholders more than dividends.

Appointing BDO Global will bring trust, credibility and recognition. Even though they appointed BDO to audit their subsidiaries, they won’t release the report to the market. There’s no use for us if they don’t release the report. How much ever they say that BDO audits their subsidiaries, market won’t believe it unless it sees the report. I think the CEO doesn’t understand this.

In the conference call, our first question/suggestion should be about appointing a big 4 or BDO to audit BCG’s India operations. We should be very persistent on this.

(Revenue of the standalone business is Rs.480 crs so 0.5% of that is Rs.2.40 crs)

[Logan]

Does anyone know how much would an audit firm like BDO Global or any Big 4 charge BCG to audit BCG’s India operations?
I read it’s on average 0.32% of the revenue. I’m not sure about that so I wanted to check with others.

It would be helpful if anyone in this forum knew about it so that we can suggest the company to appoint a Big 4 auditor.

[Logan]

I don’t think they’ll release the BDO report to the market as it contains sensitive information, guess they don’t want competitors to see that report.

If they convince the market that the numbers are legit, then nothing can stop the stock from reaching great heights.

That is why I want them to appoint BDO to audit India operations as well, it brings credibility and trust.

With one shot they can resolve many issues but they are not understanding that.

[Logan]

Hi Pranil, instead of many people asking similar questions, we all can discuss and appoint one person to ask all the questions. Doing this will make sure questions aren’t repeated and it also saves time.

In the conference call, at the start itself that person can say that he’s asking the questions on everyone’s behalf.

Let everyone give their queries and we can select important ones among them.

If you are okay with it you can ask those questions on our behalf.

[Logan]

@sateanna, you are absolutely right, they can’t expect us to figure out all the information on our own.

I think any big auditor wouldn’t have reported like how PCN has reported. Appointing a good auditor is very important at this time when people have so many confusions and when the sentiment is negative.

Knowingly or unknowingly, the company itself is making many problems even worse, they are creating more problems while trying to clear old ones.

Being a new age Technology company, they are behaving like we are in the 80s when it comes to providing proper details. We get the information only if we attend the conference calls.

No doubt they clear most of our confusions in the conference calls but they should remember that only a few investors attend the calls. And if they want value recognition they should provide proper details.

Verbal communication won’t matter at all to some people.

They have to give written information on few important items. In the annual report they should mention all the details properly.

They should understand that they should provide information to the whole market and not just to existing shareholders.

[Logan]

My understanding is that the company still doesn’t know how to communicate with the investors properly.

Take axis bank loans for example, in the report they have mentioned that the loan is NPA, no problem with that, but they could’ve explained that though the loan is NPA, the original amount was more than 30-40 crs and they have paid down the loan till now and the remaining amount is only 11 crs.

Only old shareholders will know this information and people tracking the stock will get confused or they may think that the company is bad because of the NPA. One simple explanation would help solve so many problems and confusions.

[Logan]

Hi pranil, in the last call Mr Reddy said that the amount is finalized and they are negotiating on some legal clauses and 95% of the job is done. I think he’s making sure that DAUM won’t get back to them again in the future. I don’t know why he has to travel to South Korea but let us not worry too much on Lycos.

And for the company, I don’t think getting back Lycos is very important right now, there are many other important things like LOC, consolidation of subsidiaries etc.

If you see they are signing reputed publishers like Philadelphia Magazine, boston.com, The Seattle Times, Boston Globe, The Salt Lake Tribune etc.

Since this year there is Presidential election in the US, there will be an increase in consumption of news content and signing the above reputed publishers may help in generating more revenue. So maybe they are focusing more on business.

[Logan]

Like the last conference call, this time too they should conduct it for 2 hours, we have so many questions and 45 minutes won’t be sufficient.

[Logan]

@pranil, you are right about the importance of having a reputed auditors, do you know how much BDO would charge if BCG appoints them to audit the India business too?

Coming to write offs, in the balance sheet there are no significant changes and in fact the receivables have gone up, so I think they haven’t written off receivables.

There’s so much confusion about the write off. 800+ crores is not a small amount, they should’ve given details about it.

[Logan]

@pranil and Ian Biden.

You both are right. While investing we have to do both qualitative and quantitative analysis.

@pranil, you can post your suggestions in “Areas of Improvement” thread. Please try to post before the results so that we all can discuss and compile a set of questions and ask those in the conference call.

[Logan]

Hi Pranil, I was talking only about post #7178 and not about posts #7179 and #7180. I’m using my phone and it took long for me to type and I didn’t see your later posts.

Let us forget all the previous posts and concentrate on important things.

I will start a new thread where everyone can give their suggestions.

I have discussed with the admin and I have prepared a draft for that and there are few changes that I need to make and I will upload it by tomorrow EOD.

You can also give your suggestions there and together we all can discuss and appoint a person to ask questions to the management in the conference call. Instead of many people asking questions it’ll be better if a single person asks the questions on everyone’s behalf.

[Logan]

Hi Pranil, I have been polite with you all this time but you are trying to provoke me, don’t plant wrong information about me here, being a long term investor myself, I never called long term investors as impatient.

I’ve called people who buy stocks looking at price alone as impatient. It’s because of people like you I didn’t write anything all these years.

I’ve not compared Apple with BCG. I don’t think you got my point. I mentioned that even the big companies in the world have struggled. And BCG also paid dividend in 2012 and 2016, did that change market sentiment?
10 years back BHEL was trading above Rs.300 and now the price is Rs.30. I’m not comparing BCG with BHEL business, I’m comparing only the price and again my point is that all companies have troubles with their stock prices.

It’s not my problem if you don’t understand the problems faced by the company, I can’t spoon feed everything to you.
It’s not the management’s fault if people like you don’t understand the nature of the business.

If you are talking about the performance of the company, yes, they have performed well all these years. But it’s people like you who don’t appreciate that. You only see the price and think that is more important than the survival of the company.

If you don’t understand the difference between profit and cash flow then it’s not my problem.

I too feel frustrated looking at the price but unlike you, I understood the problems the company is facing.

If you are frustrated with the management go ask them for answers. Why are you asking for my opinions if you don’t understand them properly?

If you have suggestions we all long term investors are ready to take them and we all can discuss about them with the management. But if you ask my opinion on something and later accuse me of something which I didn’t do then I’ll stop replying to your questions.

[Logan]

@Raj

I don’t know anything about the selling, like you I’m also a retail investor and whatever opinion I have will only be speculation and it won’t do any good if I start sharing my opinions.

I don’t know whether BCG has arranged a buyer for OAK’s shares or not. Maybe we should ask the company about the selling.

[Logan]

Thank you Investor_2022.

I really can’t predict the timeline of the events especially now with COVID-19 pandemic.

If all went well, Lycos case with Daum would’ve been settled by early March this year. Mr Reddy was supposed to travel to South Korea and close that off.

South Korea was hard hit by the virus in February and early March so he didn’t go there. I’m not sure whether it’s safe for him to travel there now also.

These days the company is updating us regularly through the exchanges.We should appreciate that.

May be we’ll get a clarity from the CEO in the conference call after the results.

[Logan]

Since they do most of their business in the US, they are consolidating all their subsidiaries and forming a new entity there.

I checked some of their publishers and most of them are in the US, the banks will know about their business and this helps them get funds easily.

In my opinion if they don’t consolidate their subsidiaries then some of them might find it hard to raise fund in their respective countries.

Suppose if the interest rate is 1% in the US and 5% in Canada and if they raise cash in the US they can’t send it to Canada directly, they’ll have show it as income which will be subjected to tax. Since they are spread out in 24 countries, each and every country will have different rates and different rules on raising funds.

So taking all this into consideration, consolidation of the subsidiaries make sense.

[Logan]

Hi Nithin, that’s a good observation. The company tried to raise money back in 2017 from White Oak. The amount was $150 million (around 1000 crores).

I don’t know whether it was debt or equity, but it would’ve helped the company in many ways. First they could’ve settled Lycos case with Daum then they could’ve used the remaining amount for growth and to sort out receivable issues.

When Daum got to know about this, they dragged White Oak to the court and subpoenaed them to reveal the details. Since White Oak wasn’t involved in the operations of the company, they backed off. Nobody wants to get involved in a legal case. This also made other potential investors to back off.

I think this made the company to give up hopes on Lycos and they lost the ownership.

And regarding your other question on why now and not earlier, my guess is that since they are spread all over the globe and different countries will have different rules and regulations, it would be hard for them to manage all those processes.

They must have tried many options and concluded consolidating all the subsidiaries would be the best option, and they didn’t rush it and may be this took time.

[Author]

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